Marxist Perspectives for the 21st Century

Menu

Socialists and China: An Exchange

A LeftViews ExchangeJohn Riddell’s Socialist Voice article on China’s ‘Great Leap Forward’ has prompted a discussion on how socialists should view and respond to China. The following are comments by Walter Lippmann, who maintains the CubaNews mailing list, and Herman Rosenfeld of Socialist Project, with responses by John Riddell.

All this doom-and-gloom commentary doesn’t help to explain how China, despite all of the terrible things John Riddell says the Chinese leadership has been and continues to do, has become the world economic powerhouse that it has.

Guided by the conception that China’s leadership has deliberately done the wrong thing, at least according to the Canadian John Riddell, it would be hard to explain the progress mixed with the problems which has taken place in the People’s Republic. As a minimum, China’s “failure”, as perceived by John Riddell in 2009, can be explained simply by the PRC’s failure to do what John Riddell thinks they should have done instead of what they did do, long decades after the Chinese fact.

China today is one of the world’s workshops. It’s been so successful that the United States of America is in deep economic debt to China, which is holding large amounts of US-government financial obligations. This may be one of the reasons why Washington no longer tries to blockade China as it did for the first quarter century after the triumph of the Chinese Revolution in 1949.

Though some foreign investors have made lots of money from their Chinese investments, and social differentiation in the People’s Republic is substantial, it is ALSO true the China is an international economic giant. These facts are at odds with one another from a socialist perspective, but are they entirely contradictory? Isn’t it possible that both are true at the same time? It’s obvious that it is.

Just why some Canadian radicals, like some in the United States and Australia as well, seem so bound and determined to revile China, rather then focusing primarily on how to understand what has happened and why, is certainly beyond my understanding.

Instead of trying to force the Chinese square peg into the round hole of the experience in the early years of the Soviet Union, it would seem better to try to look at China through the prism of its own history, culture, traditions and experiences. The idea of historical models, against which each socialist experience is to be judged – and usually found wanting – should be jettisoned, in my opinion.

Fidel Castro has a completely different view of developments in China. A selection of his commentaries on China over the past ten years can be found here: Fidel Castro on the Chinese Revolution

–

+++++++++++++ John Riddell: Reply to Walter Lippmann

Walter Lippmann is right to stress the remarkable successes of China’s development into “an international economic giant.” He also provides a link to useful statements by Fidel Castro on the Chinese revolution.

But what is his quarrel with my article, “50 Years After: The Tragedy of China’s Great Leap Forward”? Walter’s comment makes no reference to my topic and no specific reference to the article. Yet he dismisses the article as “gloom and doom commentary.”

Did he read the article’s opening paragraphs? They state:

“On October 1, the People’s Republic of China will mark the 60th anniversary of its foundation. This will be an occasion to celebrate one of the most influential victories of popular struggle in our era.

“This great uprising forged a united and independent Chinese state, freed the country from foreign domination and capitalist rule, ended landlordism, provided broad access to education and health care, and set in motion popular energies that modernized and industrialized its economy. The revolutionary triumph of 1949 laid the foundation for China’s present dynamism and influence, as well as providing an enormous impetus to anti-colonial revolution worldwide.”

Does Walter disagree with this assessment?

Walter refers us to Fidel Castro’s comments on China. But nowhere does Fidel take up the ‘Great Leap’ experience. This is in fact unnecessary: one need only compare the heavy-handed methods of ‘Great Leap’, and its disastrous results, with the care and wisdom of Cuban policy toward farmers over fifty years of revolutionary history.

Walter seems to wonder why a socialist today – a ‘Canadian’, no less – would wish to analyze events that took place so far away and so long ago.

This question is answered in the sentence of my article immediately following the quote given above. It asks why “the socialist movement and ideology that headed the revolution, identified with Communist Party Chairman Mao Zedong, disappeared from China soon after his death in 1976.”

The revolution led by the Chinese Communist Party began with sweeping authority and prestige in all sectors of society – more extensive than in any other anti-capitalist revolution of its century. Today the Communist Party still rules, and the flame of anti-imperialism is strong in the consciousness of Chinese working people. But there is no socialist movement in China. No sector of the world’s oppressed and exploited look to today’s China for political guidance and inspiration. Despite its immense wealth and prestige, China does not carry out international solidarity work on the scale even of small, poor, and embattled Cuba.

My article aimed to take a small step toward an explanation, by describing the circumstances in which the close alliance of the Chinese Communist Party with the peasantry was shattered.

This is an issue worth debating.

–

+++++++++++++ Herman Rosenfeld: Email to John Riddell

Your response is quite correct and quite measured, but it doesn’t openly articulate (although it alludes to) a critical point that folks like Lippmann conveniently leave out: China no longer attempts to build a society based on the solidaristic principles and collective capacities of working people – in other words, socialism. It looks to build a modern economic defined and motivated by the private accumulation of capital in all of its most fetishistic elements.

Just because it is ruled by a single-party dictatorship that relies on its revolutionary roots and the vestiges of an earlier socialist tradition doesn’t make it socialist. There are reasons that working people around the world don’t look to China as a model of a different society (but possibly as a model of raw development, where a strong state can help shape that development).

–

+++++++++++++ John Riddell: Email to Herman Rosenfeld

You put it very well. You capture the essence of the problem in China.

But I think there is more to it than that:

The rise of Chinese capitalism builds on the victory of the Chinese revolution against feudalism and imperialist domination. Chinese economic vigour testifies that this revolution is still strong. There is plenty of evidence that it lives in the consciousness of the Chinese people.

China also benefits from the strength of the state as an economic player, especially with respect to the banks. This has been shown in China’s ability to sail through two major capitalist financial collapses, one regional (a decade ago) and the other worldwide. I hesitate to ascribe socialist significance to the state sector; it seems more to be state capitalist. But let’s recall what Lenin said about the progressive significance of state capitalism, under certain circumstances. The circumstance in China is that the strong state sector and state economic dirigism greatly strengthen China’s defenses against its imperialist rivals.

China is often called imperialist, but I don’t see the evidence. Certainly Chinese international economic policy is motivated mainly by desire for gain and only very rarely by considerations of solidarity. But the Chinese state does not appear to need at present to conquer spheres of influence and assert its economic and political domination over client states and semi-colonies. China has been helpful to countries like Cuba under U.S. attack. China leans toward defending the sovereignty of poor countries, much to the annoyance of the U.S.

My feeling is that the need to defend China against imperialist incursions is still posed, and needs to be taken into account in approaching questions like Tibetan self-determination.

LeftViews is Socialist Voice’s forum for articles related to rebuilding the left in Canada and around the world, reflecting a wide variety of socialist opinion.

Post navigation

18 thoughts on “Socialists and China: An Exchange”

Praba says: “In the capitalist countries the period since 2000 has been one of aggressive moves towards “user pays” in social services. In China instead we have seen moves back towards universal, free or affordable public health care, education, public transport and even cinemas.”

These are welcome moves, but we should not forget that it was the Communist Party government that abolished affordable health care etc in the first place. China’s health care system became “one of the most commercialised in the world”, according to a very informative article by Shaoguang Wang (Economic and Political Weekly, December 27, 2008). http://epw.in/epw/user/issueResult.jsp

In the 1990s the Chinese government was in many ways one of the most extreme neoliberal governments in the world. It carried out extensive privatisation and allowed the exploitation of migrant workers with no union protection and no legal rights whatsoever. The result was that China moved from being a country of relatively low inequality to above average inequality. The GINI index (a statistical measure of inequality) went from 0.16 in 1979 to 0.45 in 2001, compared to a world average of 0.40. (figures from retired researcher Sun Xuewen, quoted by Eva Cheng in Green Left Weekly no. 695, 24 January 2007. http://www.greenleft.org.au/2007/695/36092 )

“The ranks of China’s US dollar billionaires have swelled from three to 130 in just five years”, according to the Melbourne Age’s China correspondent John Garnaut (The Age, October 14, 2009). (The fact that some of these billionaires have finished up in jail is not unique to China. The same has happened in Russia under Putin).

Two things began to turn the situation around. Firstly, the rising level of worker and peasant resistance. Secondly, the onset of the Asian economic crisis of 1997-98 (and later the 2008 world economic crisis). These factors caused some sections of the CP leadership to question the extreme neoliberal policies, and recognise the need to maintain a fairly strong state sector and rebuild some sort of welfare state.

Praba says: “Secondly, the fact that Chinese workers have been able to win concessions since at least as far back as the year 2000 and the fact that they are in Slee’s words “fighting back” shows that the Chinese working class has not been very demoralised over the last decade. Yet any working class that suffers a major defeat is very demoralised for a considerable period of time. According to Slee the Chinese working class suffered a capitalist counterrevolution in the 1990s – the most catastrophic defeat. Yet it has not been acting like it suffered such a defeat!”

The time taken to recover from a defeat is not fixed. It depends on a range of national and international factors. For example, it was only a few years after the defeat of the 1905 revolution in Russia that a new wave of workers struggles began.

Praba says: “Thirdly, although the tendency which Chris Slee supports first publicly declared that China had become capitalist in the late 1990s, it was well into the 21st century declaring (like most other left groups that claim that China has become “capitalist”) that steps were occurring to move China further towards capitalism – in other words it was basing itself on the notion that the capitalist counterrevolution was then (i.e. in the 21st century) still in the process of being completed”

I agree that the DSP was slow to recognise the beginnings of progressive change in China after about the year 2000. Change was initially slow and contradictory, with backward steps as well as progressive measures being taken. For example, privatisation continued for some years, albeit at a reduced pace.

Praba says: “Fourthly, in real capitalist countries when workers struggle are strong enough to win concessions from the capitalists it leads to a loss of business confidence, to lethargy from those running the economy and especially to a collapse in business investment….

“Yet in China, in the very period when Slee says that the workers “fightback” is “winning concessions”, we are seeing the very opposite. There is great economic dynamism and massive investment.”

In a country with a strong state sector of the economy, the government is sometimes able to simply order state-owned enterprises to invest, and state-owned banks to lend money, regardless of conditions on the world market, and regardless of the level of class struggle, etc.

China (unlike Cuba) is in a strong position to do this. China is able to import unlimited amounts of raw materials, using the huge foreign exchange reserves built up over decades of production for the world market, and is not subject to the same very severe restrictions on technology import as Cuba.

However a strong state sector does not necessarily prove the existence of a workers state. Iraq under Saddam Hussein had a strong state sector, but the state served the interests of the Iraqi capitalist class.

In China in the 1990s, the state generally acted in the interests of the capitalist class. Today this is less clearly the case. The rise of worker and peasant struggles, and the rising critique of neoliberalism amongst Chinese intellectuals (including CP members), have caused the Chinese state to implement some pro-worker reforms.

At present I still view the Chinese government as a reforming capitalist government. Its limitations are exemplified by the fact that migrant workers (a large part of the working class) are still denied legal rights in the towns where they work, and hence are able to be exploited in an exceptionally ruthless way by local and foregn capitalists, and quickly discarded when no longer needed.

But if progressive reforms continue to deepen, I may have to reconsider.

Praba says: “Following on from our understanding that the PRC is a deformed workers state, the group that I sympathise with actively supported the pro-PRC demonstrators at the torch relay and in general opposed wholeheartedly the anti-communist “Free Tibet” propaganda campaign.”

The pro-China demonstrations were essentially nationalist, regardless of the color of the flags. The large size of the demonstrations reflected both the strength of Chinese nationalism and the large number of Chinese citizens (particularly students) currently in Australia.

If the Olympics had been held in India, and if Kashmiri activists had disrupted the torch relay, there would probably have been big pro-India demonstrations in Australia, greatly outnumbering the Kashmiri protestors (given the relative numbers of Indians and Kashmiris living in Australia).

Chinese nationalism is progressive when directed against imperialism, but reactionary when directed against oppressed groups within China such as the Tibetans and Uighurs.

Probably consciousness among the Chinese students at the demonstrations was mixed, combining progressive anti-imperialist sentiments with incomprehension of the Tibetans’ grievances.

Marxists should aim to educate members of the Han Chinese majority about the reasons why Tibetans and Uighurs feel oppressed, and why some of them want to break away from China and establish independent states. This is essential for voluntary unity amongst the nationalities, and is an important part of the struggle for socialism in China.

Fred Feldman writes that China is not an imperialist state. It would be a nation oppressed by imperialism. His criticism rests on the lack of evidence in my appraisal of Chinese imperialism.

Before showing some of the evidence, it seems to me that one of the problems in this debate over the nature of the relations between China and the rest of the world, is the fact that we are lacking today a valid theory of imperialism. Lenin, Bukharin, Luxembourg and the other figures of classical Marxism formulated their theoretical framework in historical conditions which share few similarities with the world we live in today. Even though a new theory of imperialism will necessarily have to integrate their contributions, it is non-sense in my view to claim that we have the right tools to understand the nature of imperialism at the beginning of the 21st century. Questioning the concept of imperialism in the light of today’s world appears therefore as being the corollary of the critical mode of thought necessary to any revolutionary project. In that sense, my goal is certainly not to put on the same plane Western imperialism with contemporary China’s quest for power.

Having said that, below are some of the facts showing that far from being an imperialist superpower or an “oppressed country”, China tends to combine together the old (a Third World country) and the new (an “emerging power”). It is in fact startling to see that a country with a GDP per capita at 4 000$ (2008, World Bank figures) has imperialistic relations of the same kind as the US, whose GDP per capita stands at 48 000$.

1. It is not the unequal terms of exchange that make China an imperialist state. It is rather the fact that its investments abroad (emanating from public or private companies) are searching to establish in some cases a control on its hosts.

An example: a contract signed in September 2007 between the Democratic Republic of Congo and China. It gives to the latter access to mineral deposits in the eastern provinces of the RDC: 10 million tons of copper, 200 000 tons of cobalt, 372 tons of gold. In exchange, two Chinese state companies have committed to build 3 000 km of roads and railways, 31 hospitals of 150 beds each, four universities, 145 health centres. To finance this infrastructure, the China Exim Bank is lending $8.5 billion loan, and that amount could increase.

Such economic relations are certainly “beneficial” for the African countries if we compare them with the structural adjustments of the IMF and World Bank. But aren’t they also relations of economic domination?

Another example: the purchase of fertile land in Africa by China to secure food and bio fuel supplies. China invested $800 million in Mozambique to buy 100 000 acres of fertile land. The Chinese are not the only ones to do so: South Korea, the oil-rich Gulf states and India also invest in what The Economist calls the “great land grab” (May 23rd – 29th 2009). Jacques Diouf, head of the UN Food and Agriculture Organisation, designated these deals as a “form of neo-colonialism”.

In both cases, we see that Chinese investments lead to control. This seems to me as being the main criterion of modern imperialism, i.e. through exports of capital. These foreign investments are quite different from the investment flows between developed countries. When foreign capital takes hold of natural resources in the developing world, it stunts the development of these countries since their integration to the world market is done through a single-crop economy. Moreover, to assure themselves of these supplies, the Chinese link themselves to the stability of the established regimes. These regimes in their turn link their destiny to a model of development obeying to the needs of external economic centres.

This is demonstrated by the structure of commercial relations between China and the African countries. According to the 2007 figures of the WTO, Chinese exports to Africa are made up of manufactured goods 92%. As for the African exports to eastern Asia: 75% of their value comes from minerals and fossil fuels.

2. China is ranking no. 3 in military spending in 2008 with $58 billions. The British are no. 2 with $60 billions, the US at the top with $547 billions. These figures do not prove by themselves any quest for world hegemony on the part of China, but they tend to show that it is far from being “an oppressed nation” by Western imperialism. Moreover, China is part of the powers having military cooperation agreements with many African states: military training, technical counselling and equipments.

Such agreements have been signed with the following African states: Algeria, Morocco, Libya, Egypt, Sudan, Eritrea, Ethiopia, Kenya, Cameroun, Nigeria, Gabon, Angola, Namibia, Kenya and South Africa. Most of these states have at the same time, like Algeria for instance, agreements with the French and the Americans as well. Even if Chinese military influence is thus limited (and even helpful to decrease the military dependence of many of these states towards the Western powers) – China’s military relations with these countries are nonetheless means to exert its influence.

3. Does China suffer from “imperialist extortion” given the fact that it is one of the main debtors of the US? If this is true for China, then it is true for Japan. China holds in 2008 $700 billion worth of US Treasury bonds. Japan: $580 billion, the United Kingdom $350 billion. Are the Japanese and the British victims of US imperial extortion?

4. On the 1st of January 2009, the China-Asean Free Trade Area (Cafta) went into effect. Walden Bello writes in that sense that it will more probably benefit the Chinese economy at the expense of other less advanced economies of the Asean. His conclusion is the following:

“To sum up, despite the official propaganda, the China-Asean trade agreement that came into effect on Jan. 1, 2009, is likely to disadvantage Asean. Even with the temporary exemptions of certain from full trade liberalization, Asean would be locked into a process where the only direction that barriers to super-competitive Chinese industrial and agricultural goods will be downwards. Being one of Asean’s weaker economies, the Philippines has already seen itself driven into a massive deficit in its relations with other Asean countries under the Asean-Cept free trade scheme.”

Moreover, the agreements of Chiang Mai (February 2003) put in place a financial cooperation between central banks in case of a financial/monetary crisis in the region. Even if this gives an independence from the IMF, this agreement also registers moves of the main financial powers of the region to exert their influence on neighbouring and less-developed countries. Among these financial powers we find China

In his original posting, Chris Slee responds to a point about the audacity of the Chinese working class over the last two decades by stating that: “It is true that the workers are fighting back against the attacks.” Slee also states that, “It is true that in recent years, particularly since about the year 2000, the government has made concessions to the workers.”

If we examine these two statements we find that they end up contradicting Chris Slee’s incorrect assertion that China is a capitalist state.

Firstly let us look at the “concessions” issue. It is of course true that, in an actual capitalist country, workers through struggle can win concessions from their exploiters. However, in the modern world, such concessions typically do not occur in complete isolation in one country but are shaped by major changes in the international balance of class forces. The late-1960s and early 1970s were a period when the capitalists granted concessions in many countries to pacify an emboldened working class and left. The period was shaped in part by the inspirational effect of the Vietnamese revolutionaries’ successful resistance against imperialism.

To be sure the class struggle has different tempos in different countries. However, especially when we are talking about a long term phenomenon (and according to Slee workers have been winning “concessions” for at least 9 years in supposedly “capitalist” China ), the particular motions in particular countries are greatly pushed along by the direction of the international tide. True there can be peculiar exceptions. However, when talking about China, a country with one in five of the world’s people, it is not valid to be talking about it as an “exception”!

If we look at China and (in Slee’s own statement) its last 9 years of “concessions” to the workers, what is happening is at complete variance with what has been happening in the capitalist world in the same period. In the capitalist countries the period since 2000 has been one of aggressive moves towards “user pays” in social services. In China instead we have seen moves back towards universal, free or affordable public health care, education, public transport and even cinemas. In the capitalist countries, we have seen draconian industrial laws that give capitalists ever more powers. In the PRC however, the new labour law that went into force in 2008 gives unions the power to veto any change in workplace conditions and makes it illegal for employers to lay off long term workers who are within five years of their retirement (even for incompetence or due to business difficulty). In the capitalist countries we have continued to see more privatisations since 2000. In the PRC we are seeing some important renationalisations. These nationalisations are not simply bailouts nor are they the government taking into public hands loss-making enterprises. Frequently they involve the state forcing profitable private firms to handover their enterprises for a price much lower than their market value – in other words these are in part “nationalisations without compensation.” For details, see for example this article from an irate finance news correspondent in Rupert Murdoch’s flagship paper in Australia:http://m.theaustralian.com.au/fi175932.htm

Clearly China and the capitalist countries are running on different tracks.

Secondly, the fact that Chinese workers have been able to win concessions since at least as far back as the year 2000 and the fact that they are in Slee’s words “fighting back” shows that the Chinese working class has not been very demoralised over the last decade. Yet any working class that suffers a major defeat is very demoralised for a considerable period of time. According to Slee the Chinese working class suffered a capitalist counterrevolution in the 1990s – the most catastrophic defeat. Yet it has not been acting like it suffered such a defeat!

Thirdly, although the tendency which Chris Slee supports first publicly declared that China had become capitalist in the late 1990s, it was well into the 21st century declaring (like most other left groups that claim that China has become “capitalist”) that steps were occurring to move China further towards capitalism – in other words it was basing itself on the notion that the capitalist counterrevolution was then (i.e. in the 21st century) still in the process of being completed. See for example: http://www.greenleft.org.au/2006/669/6576 (please note that there is an annoying little typo in the web version of this article – and similar China articles – that puts a date line in 1993 at the head of the article. However, if you read down the article it will be clear that the article is from the May 31, 2006 issue of this newspaper). Yet if the capitalist counterrevolution is still IN THE PROCESS of being completed in the first decade of the 21st century, then how come the workers are “winning concessions” in this very same period? How come tens of millions of Chinese people are being lifted out of poverty when the supposed capitalist counterrevolution is finalising its triumph? A very strange counterrevolution indeed!

Fourthly, in real capitalist countries when workers struggle are strong enough to win concessions from the capitalists it leads to a loss of business confidence, to lethargy from those running the economy and especially to a collapse in business investment. Why? Firstly, since making concessions to the workers by definition means reducing their rate of exploitation and therefore their rate of profit, capitalists, when forced into making concessions to the workers, have less profit from which to reinvest. Moreover, if capitalists see that their rate of exploitation is being diminished they are not going put their money into building up future production. They are not going to invest in infrastructure, new factories, updated equipment and buildings. They will either take their money to invest elsewhere or consume (as opposed to reinvest) a greater share of their profits: ie buy more designer clothes, luxury cars, first class air tickets etc. Thirdly, when workers are fighting back, especially when they are struggling with such an intensity that they can force concessions, the capitalists pull back from investment. Indeed there is nothing that makes the capitalists hold back from investment more than workers struggle. The capitalists know that industrial struggle disrupts their profits and they fear that “instability” could lead to a political environment where their assets get nationalised.

Yet in China, in the very period when Slee says that the workers “fightback” is “winning concessions”, we are seeing the very opposite. There is great economic dynamism and massive investment. Not only is total investment (mostly by the state sector), growing spectacularly in China but it is growing as a percentage of total GDP. Please see Chart 2B in the following reference which details the total investment rate (as a % of GDP) over the last 15 years: http://cib.natixis.com/flushdoc.aspx?id=51475

We in fact see that precisely when Slee says the workers “fightback” started “winning concessions” in China around 2000, is when the rate of investment started skyrocketing. Indeed even major “concessions” like the passing of the pro-worker Labour Law in 2007 and its introduction at the start of 2008 has not stopped the investment rate from growing. Neither has the fact that the passing of the Labour Law inspired a huge strike wave in China. In 2008 the number of labour disputes in China was 95% more than the year before. But it almost seems that the more that workers struggle and the more “concessions” that they win, the more that the people running the Chinese economy invest in future production.

Thus, although it is true that capitalists have been allowed to make too many incursions into the PRC, the laws governing the PRC economy still have little to do with capitalism. For more details, see the following article http://web.aanet.com.au/tplatform/China.html in particular the sections titled “`Making Concessions’ and Loving It” and “Profits Plummeting? OK, Let us Expand Production!”

I think Socialist Voice website is doing the international left a real service by hosting this discussion. The question of the class nature of the state power that holds sway in the world’s most populous country is a critical one. It is a question not of academic importance but a question that shapes what attitude socialists in the West should take to the PRC state – hostility or solidarity.

I saw this very concretely posed on April 24, 2008 during the Australian leg of the Beijing Olympics Torch Relay in Canberra. The question of whether an Olympic torch gets through is not in itself of strategic importance but the political struggle around the torch relays was a huge political and propaganda battle between pro- and anti- PRC forces. Following on from our understanding that the PRC is a deformed workers state, the group that I sympathise with actively supported the pro-PRC demonstrators at the torch relay and in general opposed wholeheartedly the
anti-communist “Free Tibet” propaganda campaign.

However, in concert with their claims that China is “capitalist”, most of the Australian left supported the anti-PRC protests at the torch relay. As a result, the bourgeois media, which normally vilifies left groups, gave left groups involved in organising the anti-PRC protests a sympathetic coverage (and this from Rupert Murdoch owned papers!). The far left however made up just a fraction of the anti-PRC mobilisation. In far greater numbers were ignorant, white, small-l liberals. There were also plenty of Falun Gong people burning both the red PRC flag and the hammer and sickle Communist Party of China flag. Also dwarfing the left contingents but standing shoulder to shoulder with the left during the protests, was a big crowd of hardline Vietnamese anti-communists brandishing the defunct flag of old capitalist South Vietnam. In Australia, every anti-PRC demonstration meets with strong solidarity from Vietnamese anti-communists.

The clash between the two sides was very heated both verbally and physically – there was lots of pushing and shoving and some scuffles. Who won? The pro-PRC demonstrators by knockout! Tens of thousands of mainly PRC international students swamped the anti-PRC forces. The PRC students brandished the communist, red PRC flag and were mainly organised by the Communist Youth League, the youth wing of the Communist Party of China. It was a fabulous victory that sent the capitalist media in Australia mad with outrage. For an eyewitness account of the events see: http://web.aanet.com.au/tplatform/index10.htm under title “From the Bright Depths of the Sea of Red.”

However, the role of most of the left that day was tragic. Not only because they were on the wrong side but because of how much could have been achieved had they been on the right side. True the pro-PRC forces won easily even without the Australian lefts’ help. But had the far left joined in with the red flag bearing PRC students, it would have had a very positive political effect. It would have further enhanced the pro-communist aspects of the demonstration as opposed to the Chinese patriotic aspect. It would have told pro-communist, Chinese students that they are not alone and they would have gone back to China and talked much about this. In short it would have encouraged sorely needed internationalism within China. And by solidarising with a workers state, deformed and corroded as it is, Australian leftists would have achieved a greater understanding of the need to eventually establish a workers state, i.e. the dictatorship of the proletariat, in Australia. I really hope that more socialists in the West can be won to the need to defend the PRC workers state.

Please note that for space reasons I have not replied to the last point in Slee’s first posting about the factional contests within the CPC. I will reply to this and to Slee’s subsequent postings in a later posting. I hope this discussion will be able to continue here.

Chris Slee re-asserts his oft-declared belief that China is a capitalist country. I posed one simple and obvious question to Chris Slee:

“Where else in the capitalist world in today’s era of neo-liberal globalization are capitalist governments giving workers MORE rights, encouraging MORE unionization and creating NEW welfare systems to replace old ones destroyed by privatization?”

Chris Slee has not answered this question. Readers would like an answer, please.

In his message of 23 January, Walter Lippmann says: “Where else in the capitalist world in today’s era of neo-liberal globalization are capitalist governments giving workers MORE rights, encouraging MORE unionization and creating NEW welfare systems to replace old ones destroyed by privatization?”

Firstly, we should remember that it was the CP government (under a previous leadership) that created the problems which the current leadership is trying to ameliorate. Secondly, the reforms adopted so far don’t solve all the problems which the previous policies created.

For example, the government under the previous leadership allowed foreign and local capitalists to exploit migrant workers (rural residents working in the cities) in an exceptionally ruthless manner. They were not only un-unionised, but were subject to laws preventing them from staying in the cities if their employer no longer wanted to employ them.

While the All China Federation of Trade Unions is now signing up migrant workers as members, the residency laws remain in place, so migrant workers remain vulnerable, particularly since 20 million of them were sacked due to the world economic crisis.

In his message of 24 January, Walter says: “Chris Slee never explains when he thinks China returned to capitalism, and how that happened. I don’t have to defend that view since I do not hold it, but someone who holds that view ought to explain how a country with a billion people had a more-or-less non-violent counter-revolution.”

I could ask Walter a similar question. When did Russia become capitalist? Yeltsin’s seizure of power in 1991 was “more or less non-violent”.

My answer in the case of China is that it occurred in 1989-1992, beginning with the Beijing massacre and culminating in the adoption of a policy of massive privatisation.

Walter says: “Chris Slee quotes Trotsky’s reference in THE REVOLUTION BETRAYED to the Soviet bureaucracy’s having, as Slee puts it, “ceased to offer any subjective guarantee whatever of the socialist direction of its policy. It continues to preserve state property only to the extent that it fears the proletariat”.

“Slee omits to mention that when writing THE REVOLUTION BETRAYED, Trotsky’s view was that the USSR remained a workers state, one which Trotsky declared must be defended unconditionally (though not uncritically), against imperialist attack. Trotskyists continued their unconditional defense of the USSR up until its fall in 1989.”

Actually the Soviet Union was dismantled in 1991. More importantly, for Trotsky a key indicator that the Soviet Union was still a workers state was the fact the state continued to defend nationalised property. Whether this was the case in China in the 1990s is debatable. A large amount of state property was privatised, though some was retained in state ownership.

Walter says: “Indeed, as one reads Chris Slee’s contribution, it’s evident that Slee is approximately 99% hostile to everything which he sees as having happened in China.”

My view is a bit more complex than that! The 1949 revolution resulted in huge gains for the Chines people, terms of social justice, economic development, health, education, etc.

On the other hand, the Great Leap Forward and the Cultural Revolution resulted in big setbacks.

The post-Mao period saw some beneficial reforms. But the Beijing massacre of 1989 and the subsequent privatisation drive led to an enormous setback in terms of social justice, despite rapid economic growth.

In the last few years we have seen some modest progressive steps. How far these will go remains to be seen. If it leads to a new advance towards socialism I will be delighted, but I think it is premature to predict that.

Chris Slee never explains when he thinks China returned to capitalism, and how that happened. I don’t have to defend that view since I do not hold it, but someone who holds that view ought to explain how a country with a billion people had a more-or-less non-violent counter-revolution.

Chris Slee quotes Trotsky’s reference in THE REVOLUTION BETRAYED to the Soviet bureaucracy’s having, as Slee puts it, “ceased to offer any subjective guarantee whatever of the socialist direction of its policy. It continues to preserve state property only to the extent that it fears the proletariat”.

Slee omits to mention that when writing THE REVOLUTION BETRAYED, Trotsky’s view was that the USSR remained a workers state, one which Trotsky declared must be defended unconditionally (though not uncritically), against imperialist attack. Trotskyists continued their unconditional defense of the USSR up until its fall in 1989.

Slee writes that the Chinese bureaucracy lost its fear of the working class during the 1990s, relatively recently by historical standards. Trotsky defended the Soviet Union unconditionally against imperialist attack, despite the bureaucracy’s loss of fear of the working class. But to Chris slee, China can now be attacked unconditionally.

Indeed, as one reads Chris Slee’s contribution, it’s evident that Slee is approximately 99% hostile to everything which he sees as having happened in China. His comments constitute an implacable indictment.

In conclusion, let’s suppose, for the sake of argument, Slee and Riddell were right and China IS capitalist. Let’s look at how China responded to the Sichuan earthquake, on the one side, and how Washington responded to Hurricane Katrina and how Washington is responding to the Haitian earthquake. One would certainly have to say that Chinese capitalism is doing a hell of a better job than is the the US variety of capitalism.

Praba says: “Although there was way too much privatisation in China in the 1990s, the private sector is really only dominant in light manufacturing and retail.”

Calling it “light” manufacturing makes it sound unimportant. But the production of consumer goods for the world market employs vast numbers of Chinese workers, and has played a key role in China’s rapid economic growth.

Praba says: “Of all the fixed assets in China (buildings, factories, infrastructure etc), 86% is in state hands.”

This statistic gives a misleading impression. A building may be owned by the state, but used to generate profit for private capital.

According to Anita Chan, in her book “China’s Workers Under Assault”: “…many local governments and bureaucracies are themselves partners of the joint ventures…The Chinese side usually provides the land and the factory building, and seeks to ensure the docility of the workers. In such circumstances, government and management stand together against labor”. (p.15)

Praba says: “Chris Slee is basically arguing that if post-Soviet Russia had gotten the same degree of foreign investment as China its rate of development would have been comparable to China’s. The implications of this line of argument are very harmful for socialists and not simply for this debate about China. If we accept this line of argument it has liquidationist conclusions for the general anti-capitalist struggle. It means accepting that not only is imperialist investment and capitalist rule (which is what Slee thinks the PRC has come under) sufficient to promote rapid economic development but that imperialist investment is indeed key to such development.”

That is not what I meant. I was merely rejecting Praba’s argument that rapid economic growth is proof of the non-capitalist nature of China.

I agree that capitalism holds back the development of the productive forces on a world scale. But this does not mean that capitalism can not bring about rapid economic growth in some significant parts of the world for a considerable period of time.

I did not mean to suggest that capitalism is the only system that can bring about economic growth. China’s industry developed fairly rapidly during the period when it was 100% state owned.

My point was that, in considering whether a country is capitalist or not, we can’t just look at economic growth. We have to look at the relations of production.

Workers in China sell their labor power to an employer, which in many cases is a local or foreign capitalist. Many workers are migrants from rural areas without even formal legal equality in the cities where they work. Hence they are vulnerable to the most extreme forms of exploitation.

According to Anita Chan, “Migrant workers numbered about 80 million in 1999, a group almost as large as the urban state enterprise and urban collective workforce compined.” (p. 7)

Migrant workers have no job security. 20 million were sacked from export oriented indudstry as a result of the 2008 economic crisis.

Thus a substantial part of China’s working class suffers directly from capitalist exploitation, and feels the direct effects of capitalist economic crises.

Workers in the state sector are also impacted by the spread of capitalist relations of production in China. Many have been sacked, while others have lost welfare benefits.

Other countries can not simply imitate China, because China already occupies a certain niche in the world capitalist economy. Indeed, many transnational corporations relocated much of their production from other third world countries to China, because of lower labor costs, better infrastructure, etc.

Praba says: “The notion that China’s rapid development is primarily due to foreign investment is in good part a Western media myth. The main reason for the PRC’s economic success has been the dominance of its economy by large state-owned enterprises, which while not subjected to direct central planning are still coordinated and at key times centrally directed.”

I agree that the state sector plays an important role, including providing infrastructure used by private capital, but the huge influx of foreign capital producing goods for the world market is what caused China’s unusually high growth rate.

Praba says: “To the point that Chinese working people would not allow capitalist forces to take power by stealth without a major political battle, Slee responds that “There was at least one major battle – the Beijing massacre of 1989 – as well as numerous smaller ones.”

“Yet the tragic events at Tiananmen in June 1989 were not one where there was a clear battle between those upholding the proletarian state and those for capitalist counterrevolution…..

“So while the way the opposition movement was brutally crushed was a bad thing for Chinese socialism it did not mean the victory of capitalist restorationist forces against defenders of the proletarian state as implied by Slee.”

I am not the only one to see a link between the Beijing massacre and the subsequent acceleration of privatisation and other “free market” policies. Wang Hui, a student who participated in the Tian An Men Square protests, later became a prominent academic in China. British author Mark Leonard, in his book “What does China Think?”, summarises Wang’s views as follows: “According to Wang Hui, the crackdown not only silenced calls for democracy, it also ended public debate about inequality. Once the tanks had done their work, the process of marketisation speeded up. The price reforms that had been called to a halt in the second half of 1988 were inplemented in September 1989….

“For Wang Hui, the tanks that pulverised the hopeful intellectual flourishing of the 1980s were working on behalf of market fundamentalism rather than Maoism. Contrary to the view of the repression as a reassertion of Maoist ideology, the authoritarianism was acting to silence workers’ anxieties about inequality”.

Praba says: “Meanwhile Zhao Ziyang, the CPC General Secretary, at the time who was purged for his support for the student protesters also later called unashamedly for Western-style (ie bourgeois) “democracy.” ”

Zhao Ziyang had believed that market reforms should be accompanied by political liberalisation. But Deng Xiaoping believed that a strong authoritarian government was needed in order to implement market reforms, and it was his policy that prevailed.

Praba says: “In the PRC, the main traditions that shape the army and other state organs TODAY, the examples that their personnel are thought to emulate, are socialistic struggles – in particular the 1949 Revolution, the Long March and to a degree also the War to Resist U.S. Aggression and Aid Korea (the PRC’s defence of the DPRK during the Korean War). …

“The point is that the social system that a country can follow is determined by the political character of its state organs – its army, police, courts, bureaucracy etc.”

Trotsky said in The Revolution Betrayed that the Soviet bureaucracy “…has ceased to offer any subjective guarantee whatever of the socialist direction of its policy. It continues to preserve state property only to the extent that it fears the proletariat”.

During the 1990s, the Chinese bureaucracy lost its fear of the working class sufficiently to carry out massive privatisation.

The subsequent rise of working class struggle revived that fear a bit, causing the partial reversal of some neoliberal policies.Whether the predominance of capitalist relations of production will be overturned remains to be seen.

Thanks to Socialist Voice for hosting this dialogue on the class nature of the Chinese state, and some of the consequences which flow from that.

Chris Slee says the China is capitalist, but it’s a peculiar kind of capitalism which Chris Slee describes in these words:

“The Chinese government, under the leadership of president Hu Jintao and prime minister Wen Jiabao (who both came to office in 2002), has taken some steps towards partially reversing some of the neoliberal measures. It has introduced a new labor law giving workers some minimal rights. It has encouraged the All China Federation of Trade Unions to unionise foreign owned enterprises. It has begun creating a new welfare system to replace that destroyed by privatisation. Some enterprises have been nationalised.”

Walter (that’s me) wonders: Where else in the capitalist world in today’s era of neo-liberal globalization are capitalist governments giving workers MORE rights, encouraging MORE unionization and creating NEW welfare systems to replace old ones destroyed by privitazation?

What’s decisive is what’s going on in the society, where nationalized property remains predominant in banking, the Chinese state retains control of foreign policy, and the army and mass media remain in control of the state. NONE of these have been privatized. No parties committed to restoring china to capitalism can legally exist or function.

(Russia has become capitalist and all of these conditions now obtain in Russia and in Eastern Europe, which are also all capitalist countries today.)

Groups like the International Socialist Organization are more consistent. They say that the absence of soviets means there is no socialism in China or Cuba.

Here’s the ISO on Cuba and China:

“China and Cuba, like the former Soviet Union and Eastern Bloc, have nothing to do with socialism. They are state capitalist regimes. We support the struggles of workers in these countries against the bureaucratic ruling class.”http://socialistworker.org/where-we-stand

Of course there are no soviets in China, nor are there soviets in Cuba. There never have been in either society. Similarly, there were no soviets in the Soviet Union from 1920 to 1991, but capitalism wasn’t restored there (except to Shactman and groups like the ISO, of course)

I make no claim that China is socialist. Never have. China is a workers state because capitalism was abolished and hasn’t been restored, despite the extensive privatizations and foreign investments. At the same time it doesn’t have what Trotskyists and othes would describe as a democratic political system because they permit neither mulitiple parties nor factions nor tendencies.

Of course, Cuba doesn’t permit these things either, and I assume that Chris Slee and John Riddell are not critical of Cuba’s political structures.

Chris Slee and John Riddell still seem to be committed to the notion that capitalism has been restored in China. But it’s a strange form of capitalism which is headed by a Communist Party which declares socialism to be its goal,
doesn’t allow capitalist parties nor capitalist control of the mass media.

And then there’s Vietnam, whose political structures aren’t qualitatively different from that of China or Vietnam, though with a smaller population than China (only 70 million), but larger than Cuba (onlly 11 million)